1. Field of the Invention
The present invention relates generally to electronic transfer of funds, and more particularly to a system and method for electronic transfer of funds between a sender and a recipient using an automated teller machine to dispense the funds transferred to the recipient.
2. Description of the Related Art
Although "money wiring" was developed over 100 years ago to provide the rapid transfer of honey from one point to another distant location, people in today's society still sometimes find themselves with a need to send or receive cash quickly, such as for emergency situations. These people widely vary from individuals who frequently relocate to individuals with dependents away from home. Regardless of the reason for needing to quickly transfer cash, the ability to "wire" money quickly has been very popular. Probably the most well-known provider of "money wiring" or money transfer service is Western Union.
To send money, a customer (hereinafter referred to as "sender") goes to an agent location, presents cash or a cashier's check in the amount of the principal to be transferred plus a service or convenience fee, gives the agent the name of the person to whom the money is to be sent, and is issued a receipt. The agent, using a computer in many cases, then registers the transaction which updates the Western Union system automatically. Another option for money transfer with Western Union is for a sender to call a toll-free telephone number and provide the answering agent the above-described information. The principal to be transferred, together with an increased convenience fee, are charged to a major credit card as a cash advance.
Another company specializing in money transfer services is Integrated Payment Systems (IPS), a division of First Data Corporation, allows a sender to use a credit card, as well as cash or a cashier's check, at any agent location. To be able to receive the transferred funds, the recipient again must go to an agent location, must have proper identification (valid driver's license or military ID), know where the money is coming from, the sender's name and how much is to be received.
There are a number of drawbacks to the money transfer processes described above. A recipient must find an agent location which is open--extremely difficult to do at night--and which carries sufficient cash to complete the transaction. If the agent selected by the recipient does not have enough cash, the agent will offer to give the recipient some of the cash and a check for the remainder. Often this negates the reason the cash was sought in the first place, or requires additional work on the part of the recipient to find some place that will cash the check. The sender must first purchase a cashier's check if he does not wish to carry the cash to be sent. If the sender does not have a major credit card, though he may have sufficient funds in a bank account, he may not have access to large sums of money at all hours. The privacy of both sender and recipient is compromised because the transaction is dependent on sales agent interaction. Delays may occur as a result of agent transposition or typographical errors. Moreover, such a system is very labor-intensive and costly to operate.
In an effort to overcome some of these disadvantages, BayBank developed a system which allows its customers to transfer and receive funds between most BayBank accounts electronically. While the recipient or sender does not have to be a BayBank customer, they do need to have a valid, identifiable bank account at another "linked" (affiliated) bank. A BayBank cardholder can wire money to a recipient's bank account anywhere in the United States. The only information the BayBank sender needs is the recipient's bank number and account number. The wire transfer automatically debits the BayBank account and deposits the funds in the recipient's designated account. Any BayBank customer may also receive funds from another bank. The sender must be a customer of a participating bank on the BayBank network, but the BayBank customer will be able to receive funds deposited electronically in the BayBank account.
There are still disadvantages with such a system. The BayBank system is a closed system and requires the participants (sender and recipient alike) to have accounts with BayBank or one of its affiliated banks. Moreover, a recipient still requires a card to get access to the transferred funds and the funds are transferred from account to account, rather than dispensing cash directly to the intended recipient.